It was with a cathode-ray oscilloscope that video games were first created. Pong wasn't the first video game ever created, but it was credited for kick-starting the video game industry back in the early 1970s. Being a social, 2-player game played mainly in bars, Pong was as addictive as the alcoholic beverages these locations served. Furthermore, guys and girls could play together on equal grounds as girls generally have good, if not better, hand-eye coordination.
However, in 1983, the video game market crashed. The chief reasons behind the crash were a flood of consoles and games, competition from personal computers, and price wars. Everyone, including their grandmother, was getting into the business of making games, eventually saturating the market. Pac-Man and E.T. (for the Atari 2600 console) published by Atari literally dug its own grave (hundreds of thousands of unsold cartridges were reportedly buried in a New Mexican landfill - wikipedia.org) and crashed the whole video game industry.
For the next 2 years, game developers had a hard time selling their wares. Even Nintendo, which was revived in 1981 with its hugely successful Donkey Kong arcade game, struggled to push its new console, the Nintendo Entertainment System, or NES, into US toy stores. Eventually, the NES managed to sneak into stores disguised as R.O.B., a robotic toy. It became a huge success, churning out quality games through the "Nintendo Seal of Approval" program and making video games a cultural phenomenon. Till this very day, we see major game franchises, like Metal Gear, Final Fantasy, Legend of Zelda, and Dragon Quest, that had their roots all the way back in the mid 1980s during the video game "boom"....
Fast forward to 2008. Video games are now "a $10 billion industry, which rivals the motion picture industry as the most profitable entertainment industry in the world". First week launch sales easily clock in at millions of dollars for major releases (Halo 3 - US$300m). Metal Gear Solid 4 had its opening sequence filmed/edited in Hollywood by Logan (link to Logan might contain spoilers) with a budget that rivals what some game developers have for their entire production. WoW has millions of players running around in its virtual world. However, compared to the total number of games out there, these highly successful games are actually few and far between. Quoted from wikipedia.org:
In the early 21st century, rules of thumb noted by industry commentators estimated that 10% of published games generated 90% of revenue; that around 3% of PC games and 15% of console games have global sales of 100,000+ a year (with even this level insufficient to make high-budget titles profitable); and that about 20% of games return at least some profit. The rate of commercial failure has been estimated at 95% by the International Game Developers Association.
As you can see, making a video game is like rolling a standard 20-sided D&D die and hoping to get one particular number. Because of this, fewer and fewer developers innovate or create new franchises. Sure we have games like Mass Effect that have planned trilogies and reliable sports titles like Winning Eleven (as known as Pro Evo), but these games are usually simple story continuation or quick annual graphical updates. Mass Effect 1, for example, has a play time of about 20 hours. It's hardly epic, but it isn't an epic fail either. However, consider this: a trilogy would clock in a total of about 60 hours, assuming they are all roughly the same length, whereas other standalone RPGs like Final Fantasy typically have game times of 60 hours and above. Did the developers deliberately split the game into 3 parts? Well, its a good game, and it should clock in at about 30 - 35 hours if I do the side quests, so I don't have much to complain about personally. But the point is, game franchises are now made to get quick, easy money from gamers. Year after year, people buy sports titles that have hardly any upgrades to its gameplay. Games are now getting planned sequels to suck money out of gamers. We can't blame them. The industry is getting so cut throat that they have to resort to reusing textures, maybe introduce one or two new stages, repackage the game, and place a "2" behind the title, in order to actually make a game profitable, right? Perhaps.
Another tactic used, particularly by Square Enix, is the constant reharsh/remake of a "classic favourite". For example, Final Fantasy IV for the DS is the 7th incarnation of the game since its original release back in 1991. The reason for this tactic is that the main FF games take too damn long to develop! Even Tetsuya Nomura's original effort, The World Ends With You, didn't succeed financially although it did well critically. Squeenix's head honcho has gone on record to scold it's employees for disappointing sales due to the constant delay of their main franchises. Before long, we might see the remake of the entire FF series every time a new game is released! Of course, there are SOME fans out there who want SOME games to be remade (me, FF7!), but that doesn't mean simply porting it over to every single console for every generation. Maybe a new version every 2 or 3 console generations for some of the more popular games? Needless to say, costs are low and profits are high. You spend less time writing the story and designing the characters and you have a ready audience of hardcore fans, dying to replay their favourite gems in all its next-gen glory. On the other hand, you might piss off a horde of ravaging wolves if you screw it up somehow. Win-win situation? Depends.
Which brings me to the current craze. Casual games.
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